The Little Big Red Bookstore That Couldn’t

I’ve written on my own blog about my feelings as a Borders employee and the company’s collapse. In this post I intend to dissect why Borders failed, and what it means for books, bookstores, and libraries. There are a lot of factors that led to Big Red Books’ down fall, there are a lot of factors that led to its success. These factors affect us in library land as well, so they bear looking into.

The Rise of Big Red Books

Borders began as a small bookstore owned by two brothers, the Borders Brothers. Yes, that was actually there last name. What was different about these two bookstore owners was that they were into computers. This was in the early seventies at the dawn of personal computers and when Borders Book Store’s business flourished Luis Borders developed and innovative inventory software that formed the backbone of the company’s growth. In the age of Google, OCLC, and Amazon people forget how much of a pain in the patoot it used to be to find a book. By creating a centralized inventory system and continuing to innovate software and high tech inventory management Borders was able to grow into a tasty treat that Kmart eventually picked up and fed.

At the same time Borders pioneered bookstores as communal spaces where people could come together and interact with each other around the things that they loved. Their large open stores caught small claustrophobic independents off guard. If you don’t see reflections in the development of libraries over the same period, you need to look a little harder. This intellectual communal space is a central idea to the concept of Libraries 2.0, as is the technological backbone as a way to deliver service. MARC and the inventory set up at Borders are closer than kissing cousins; they’re brother and sister spawned by the information revolution.

So borders got big, and the bigger Borders got the better it got. Not only were they able to continually advance their technology, Borders also smartly marketed to the communities where they set up. Sure they killed Mom and Pop’s Books, but they had a dedicated staff of knowledgeable booksellers (until about 2006 you had to pass a book test to work at Borders), good management, superb selection, and they had a staff member who served as a direct liaison to their community. This combination of selection, national consistency, smart branding, knowledge, and at the very least astroturfing of localism made Big Red Books a destination for book lovers. The problems started with the birth of the internet.

The Fall

Borders never really understood the internet in the same way that B&N did. Looking at the histories of the two companies I think it has to do with B&N’s legacy mail order business. Borders’ first foray into e-business was a disaster, and the company quickly signed with Amazon to handle its online distribution. This is like a library sending people down the street to the internet café, because they don’t do the web. They knew it was important they just didn’t understand how important it was to branding, and to their business. As Neil Giamen tweeted after the news of the Borders’ fate broke, “Feb1999 #Borders Mi. I said their website needed improvement. They told me they’d just subcontracted it to Amazon. I said they were doomed.”

Around this time Borders also stopped developing their inventory software. Where in the past Librarians, Booksellers, and Publishers had been marveling at the Borders’ inventory system, Borders’ system had quickly became antiquated while other organizations took advantage of emerging technology to exceed Borders system. Borders finally launched a replacement for their old software suite with a web based infrastructure system around the same time I was hired. However, it had a rushed feel, and was continually plagued with bugs, and poor metadata control. This was symptomatic of Borders at the end a company trying to play catch up, at a time when the market wasn’t able to forgive it. Tech didn’t kill Borders, but as one commentator put it, their technology failures made it inevitable.

Looking Forwards

What tech factors did Borders miss? There are the obvious ones, like Borders.com and not getting into the e-Book business fast enough, but I think that those are the easy answers. Other than being over leveraged and having piss pour management at the end borders was a victim of trends in technology, books, and society that I think bear out further examination.

First, let’s talk about eBooks. Borders was terminally slow on eBooks, but not on eReaders. Borders has been selling actively eReaders for years. The Sony Reader had a prominent place in Borders before B&N ever dreamed of the Nook. Where Borders failed was in seeing the need to have an eBook store where it could sell content for the eReaders. At the end Borders did launch a website that sold eBooks through a partnership with KOBO, a subsidiary of Indigo Chapters Canada’s largest book chain. Like the Amazon partnership this short term infrastructure hack just channeled business away from Borders.

eBooks are a mixed bag for big box stores. While they are the new wave for the “print” medium, they exist solely online. Brick and mortor stores, in the context of eBooks, are an inefficiency. As big box bookstores like Borders train readers to read words printed with eInk as opposed to real ink they siphon customers away from their stores and those stores become a cost rather than a profit generator. At the same time it’s not like a big company can ignore eBooks. It’s just too big a market as libraries are learning. A library that doesn’t have eBooks should get them. Just like the big bookstores though, an eBook system done wrong can threaten a library by incurring unforeseen costs.

Another technological trend is point of service publishing. POSP is an emerging technology that distributes the manufacture of physical intellectual goods at the point of sale. One example of this is the book ATM, which prints and binds a book from an electronic file on location. The frustrating thing as a Borders employee is that Borders was experimenting with POSP. I worked at a concept store and all the concept stores had something called Mix’n’Burn. Now most people who worked with the system hated it, because it was buggy and tended to attract weirdos like the smelly conductor. However, having a station where people could assemble their own mix cd’s was genius! Not only were you able to sell an iTunes like service to people who were on the other side of the digital divide, you also got impulse buys. Other bookstores have successfully shown that the technology works for books as well. Seattle has 3 major independent bookstores; each one has a POSP system. It allows independent stores to compete with selection the big box stores and online. Want to buy local but they don’t have the book that you want? They can print it.

POSP allows for a new wave of localism that is both local and global in character. It lets small local businesses compete with national cheap systems like Netflix, Itunes, Redbox. The fact is that people like to talk to people about things like books and movies, especially the intellectual goods they love. They want to deal with people who can help filter content for them personally. Specialty retail is alive and well and the mom and pop stores are coming back, just like Patrons are coming back into libraries to use our services and check out our books. POSP offers some interesting opportunities for libraries, especially academic libraries. Just think of the collection development possibility for any library though. A patron want’s a book that you don’t have 15 minutes later you can hand them a copy. Ok, it’s not a cloth bound behemoth but at least it’s a quality paper back that can sit on your shelves. For academic library it represents a cheap way of publishing, preserving, and popularizing rare books and special collections that are now in the public domain. The big chains are dying, but small shops, and organizations have more opportunities than ever before.

Finally, let’s talk about inventory control and technological integration. Borders as I mentioned above lost its edge in inventory control. Pallets came from the distribution centers jumbled up, and countless man hours had to be spent organizing and sorting books. The sad thing is that they had all the elements to be successful. Libraries are in the same position. By adopting technologies like RFID tags, smart networked computer systems, and tablets, we can drastically increase our efficiency. If we create these solutions open source we can make sure that we continue to ensure value to our state holders, and that others can adopt these systems to make their own improvements.

I’m not worried about Libraries going the way of the Big Red Bookstore. However, like Big Red Books there are some libraries and library systems that need to recognize the need for continued change. We need to embrace change to control it. Adopting that paradigm will be what saves us as institutions, and those who embrace it will be our leaders.

4 thoughts on “The Little Big Red Bookstore That Couldn’t”

Great post! As one of those rare #libraryschool folk who never worked at a bookstore I feel like I missed out on some preparation for my new career. This post is a really wonderful discussion of Borders and what “went wrong.” Thank you!